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    Procter & Gamble Company (A)

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    adhiraj
    The document summarizes the low-density lipoprotein (LDL) market and Procter & Gamble's products within it. It finds that the market is saturated with the top 3 players controlling 75% of volumes. A new brand introduction would require $20 million in capital and $60 million in marketing costs, but could gain 60% market share from competitors. Introducing a new price segment brand could help P&G gain untapped market share while facing low competition and cannibalization risks.

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    Procter & Gamble Company (A)

    Uploaded by

    adhiraj
    175 views4 pages
    The document summarizes the low-density lipoprotein (LDL) market and Procter & Gamble's products within it. It finds that the market is saturated with the top 3 players controlling 75% of volumes. A new brand introduction would require $20 million in capital and $60 million in marketing costs, but could gain 60% market share from competitors. Introducing a new price segment brand could help P&G gain untapped market share while facing low competition and cannibalization risks.

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    P&G case analysis

    Original Title

    Procter & Gamble Company (a)

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    The document summarizes the low-density lipoprotein (LDL) market and Procter & Gamble's products within it. It finds that the market is saturated with the top 3 players controlling 75% of volumes. A new brand introduction would require $20 million in capital and $60 million in marketing costs, but could gain 60% market share from competitors. Introducing a new price segment brand could help P&G gain untapped market share while facing low competition and cannibalization risks.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    175 views4 pages

    Procter & Gamble Company (A)

    Uploaded by

    adhiraj
    The document summarizes the low-density lipoprotein (LDL) market and Procter & Gamble's products within it. It finds that the market is saturated with the top 3 players controlling 75% of volumes. A new brand introduction would require $20 million in capital and $60 million in marketing costs, but could gain 60% market share from competitors. Introducing a new price segment brand could help P&G gain untapped market share while facing low competition and cannibalization risks.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 4

    Procter & Gamble Company

    GROUP 8 SECTION B Adhiraj Singh 17P183, Tarika Goyal 17P230, Srishti Gupta 17P229, Nirav Devpura 17P152

    (A)
    LDL MARKET SEGMENT
    Following points summarize the LDL market:
    • High level of penetration already achieved signifying a saturated market
    • The market is fairly consolidated with 75% of volumes clocked by 3 players P&G, Colgate
    Palmolive and Lever Brothers
    • Low growth potential in the LDL market and the primary opportunities exist primarily
    through volume consolidation
    • Effects of cannibalization exist as a benefit achieved from a new product is bound to
    have an effect on the numbers of an existing segment.

    The LDL market can be segmented on the basis of performance, mildness and price
    sensitivity. As of 1981, the mildness segment leads the volume sales at (37%) followed by
    performance (35%) and Price (28%).
    P&G’s Products in LDL segment
    • IVORY was a major Mildness brand with 15.5% market share.
    • Advertising: It features a mother/ daughter comparison to
    demonstrate young looking hands
    • DAWN was introduced as a Performance brand and had a 14.1%
    market share
    • Advertising: Dawn takes grease out of your way.
    • JOY was introduced as a Performance brand (12.1%) but was restaged
    with a mildness benefit in 1960’s.
    • Advertising: Beautiful dishes that get noticed and appreciated
    New brand introduction
    Requirement:
    • $20 million in capital investment
    • At least $60 million for 1st year introductory marketing expenditure
    Impact:
    • A well positioned new brand could capture at least 60% of its share from competitive
    brands
    Financial Analysis
    • Total Market Size - $850 million
    • Price Segment Share(@ 28%) = $238 million
    • Estimated market share for new brand(60%) = $142 million
    • Projected Profit from the new brand @ 12% = $17million
    • Cost of new product launch = $20 Million Capex + $60 Million marketing expenses
    Introduce a new brand in the price
    segement
    • Untapped market:
    • Since P&G has no product offering in this category, it will help P&G gain market share
    through increase in volumes from an untapped market whilst retaining the consumer
    confidence and brand image.
    • Competition:
    • Generic and private label brands with low market share
    • Lower quality of products with little or no value to the customer
    • Brand:
    • With P&G’s being the market leader in the LDL market, it would be easy to attract new
    customers in the price segment
    • Cannibalisation:
    • One of the important factors to keep in mind is the reduced level of cannibalization in
    this category due to no presence of a P&G brand.

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